Wednesday, July 2, 2014

Quirky is actually the
name of a company. It collects ideas on innovative products, has "community members"
on its list vote and comment on them, and arranges to have some of them
manufactured and sold. The idea is roughly similar to the wisdom of crowds,
with many people being smarter than a few, and has the same strength and
weaknesses. The strength is that many people are in fact smarter than a few,
especially in a topic that they have some knowledge about. The weakness is that
a product that has never been made or sold is not a topic that most people are
knowledgeable about. So, Quirky has some successes and some failures.

General Electric (GE)
is also a company that has thrived on innovation and still does. It was an
Edison company, after all, and it is in many industries where only the advanced
and innovative stay ahead. But, GE is at least thought to be very traditional
in its approach to innovation, with research and development staff making
improvements to existing products and technologies, and doing some exploration
of new ones. This means, of course, that a collaboration between GE and Quirky
would mean two firms with the same idea of innovating, but totally different
and potentially complementary approaches. Sound like a good idea? So did GE and
Quirky, and they are working together.

So how is this
working? Well, there is a new air conditioner called Aero that is pretty smart.
It can do some things humans can't, in fact. The main point is that it is
network connected and can be controlled by the smartphone of the user, which is
effective but not truly smart. The truly smart options are little details like
geo-fencing. Geo-fencing means that if you let it, the Aero will keep track of where your smartphone
is, and use the location and movement to tell when you are headed home, so it can
start up at the right time. Many think this is a neat idea, and the Aero has
sold well.

But how did the
collaboration work? In fact, GE stayed GE, if the information now reported is
correct. They did collect some ideas from Quirky, but the rest of the design
was thoroughly in-house. This is perhaps not surprising, because GE knows a lot
about air conditioners. But it is also clear that GE benefited from the
complementarity that gave these ideas. And GE is getting the idea that
complementarity is not just something you pick up in a single alliance; more
alliances make it better. In fact, many of the early sales of Aero were done
through a collaboration with taxi company Uber. Selling air conditioners
through a taxi firm? Truly complementary. Now GE is getting close to the type
of hub-and-spoke network that I, Tim Rowley, and Andrew Shipilov discuss in our
book "Network Advantage: How to Unlock Value from your Alliances andPartnerships."